Burlington approves incentives for Kayser-Roth expansion

Published: Tuesday, August 20, 2013 at 10:16 PM.

Burlington resident John Brooks said, “I wish that government and business would really not be business partners.” He said, “In my own personal businesses, I haven’t got special consideration.”

Rick White, also of Burlington, told the council, “I just wish you would, going forward, look at more creative ways” of bringing industry to Burlington. “Instead of throwing money at them all the time.” White said, “It seems like the easy and simple way out.”

Mayor Pro Tem David Huffman said he wished the state legislature would prevent local municipalities from being able to offer incentives to gain industry leaders. He said, “I wish the shape of the field was not as it is.”

But if Burlington took the position of not providing incentives to any more businesses, the city would be eliminated from future businesses’ location considerations, Huffman said. He said football players develop plays to fit the field, and if the shape of the field were to change they’d change their plays.

So it is with cities, Huffman said. “We’re using the tools that we have available to us,” he said.

One person spoke in favor of the incentives, adding that the City Council should consider putting more money into a public transportation system that would ensure the 50 new Kayser-Roth employees could get to work.

Burlington’s City Council followed in the county’s footsteps Tuesday and approved incentives for Kayser-Roth Corp’s expansion plan, expected to create 50 new full-time jobs.

The company’s chief financial officer cited keeping manufacturing jobs in the United States as a reason local governments –- or “partners” in commerce, as he considered them -– should provide incentives to the sock manufacturer’s project.

On Monday, the Alamance County Board of Commissioners approved incentives in the amount of $360,000, paid over five years in installments of $72,000. The City Council voted to give $360,000 in incentives to Kayser-Roth, to be paid in four annual installments of $90,000.

County Manager Craig Honeycutt said Monday the county’s amount is based upon the initial new taxable valuation increase of $18 million in planned capital investment.

Of that $18 million, $12 million would be invested for a building and land expansion with $6 million invested in machinery and equipment.

Todd Howard, CFO of Kayser-Roth, said, “We have an opportunity in front of us that will allow us to -– if we can pull it off -– increase our production capacity by 12 million pairs of socks a year,” which is an increase in annual production of 30 percent.

The 180,000-square-foot expansion, set to begin during the fourth quarter of 2014 and be completed by 2015, would create at least 50 new full-time jobs, and Howard said Tuesday, “I do expect the number will be larger than this.”

“While our competition over the years has taken manufacturing and jobs overseas … we have continued to invest in the United States and support jobs in the United States,” said Howard. “That remains a core value of ours.”

“Because of that it’s a very challenging project to pull off, financially,” he said.

During the public hearing, Burlington resident Steve Carter said, “If they can’t do the job on their own, they need to get out of the business or find something else to do.”

He said he had no problem with Kayser-Roth, but the company’s private project’s success shouldn’t depend on the contributions of tax-payers’ money.

“It should be able to stand on its own,” Carter said.

Howard said, “The idea is a made-in-the-USA initiative, where we would partner with some retailers,” to supply a better-quality sock that is 100 percent made in the United States, and sold “at a better price than what our foreign competitors are offering.”

To make that happen, Howard said Kayser-Roth is reaching out to its partners, from raw material suppliers to utility providers and retailers, to create a collaborative effort.

“One of those partners, of course, is the government,” Howard said.

Burlington resident John Brooks said, “I wish that government and business would really not be business partners.” He said, “In my own personal businesses, I haven’t got special consideration.”

Rick White, also of Burlington, told the council, “I just wish you would, going forward, look at more creative ways” of bringing industry to Burlington. “Instead of throwing money at them all the time.” White said, “It seems like the easy and simple way out.”

Mayor Pro Tem David Huffman said he wished the state legislature would prevent local municipalities from being able to offer incentives to gain industry leaders. He said, “I wish the shape of the field was not as it is.”

But if Burlington took the position of not providing incentives to any more businesses, the city would be eliminated from future businesses’ location considerations, Huffman said. He said football players develop plays to fit the field, and if the shape of the field were to change they’d change their plays.

So it is with cities, Huffman said. “We’re using the tools that we have available to us,” he said.

One person spoke in favor of the incentives, adding that the City Council should consider putting more money into a public transportation system that would ensure the 50 new Kayser-Roth employees could get to work.

“I saw the council move with great speed and alacrity … to consider incentives to Kayser Roth,” said Alex Alfonso. He said the city should move equally quickly to establish a transit system, as its costs will never be as cheap as they are now.

The City Council voted unanimously to approve the incentives. Councilman Jim Butler was absent from the meeting.